# GG-10: Trade Openness Vetting — Size Confound Test

Trade openness (trade/GDP) correlates r = -0.430 with log(population)
and r = -0.108 with log(GDP).

| DV | Specification | Z₁×Trade | p-value | N | Countries |
|---|---|---|---|---|---|
| CA/GDP | T0: Trade only | 0.0*** | 0.0007 | 6506 | 176 |
| CA/GDP | T1: + log(pop) | 0.0*** | 0.0027 | 6452 | 176 |
| CA/GDP | T2: + log(GDP) | 0.0** | 0.0462 | 6506 | 176 |
| CA/GDP | T3: + both | 0.0*** | 0.0071 | 6452 | 176 |
| Savings/GDP | T0: Trade only | 0.0*** | 0.0000 | 6577 | 175 |
| Savings/GDP | T1: + log(pop) | 0.0*** | 0.0000 | 6400 | 174 |
| Savings/GDP | T2: + log(GDP) | 0.0*** | 0.0000 | 6422 | 174 |
| Savings/GDP | T3: + both | 0.0*** | 0.0000 | 6371 | 174 |
| Investment/GDP | T0: Trade only | -0.0*** | 0.0000 | 6538 | 174 |
| Investment/GDP | T1: + log(pop) | -0.0*** | 0.0000 | 6364 | 173 |
| Investment/GDP | T2: + log(GDP) | -0.0*** | 0.0000 | 6400 | 173 |
| Investment/GDP | T3: + both | -0.0*** | 0.0000 | 6335 | 173 |

## Verdict

**Trade openness SURVIVES size controls.** The interaction remains significant
after controlling for log(population), log(GDP), and both simultaneously.
This is a genuine finding distinct from the spurious KAOPEN result.